Diversification by Yield and Growth

Diversification by Yield and Growth

Balancing high-yield and dividend-growth stocks algostocks can provide both current income and future income 오세훈 관련주 growth, optimizing the portfolio for different financial goals.

  1. Example: An investor might hold high-yield REITs for immediate income and dividend-growing tech stocks for long-term income growth.

Analyzing Dividend Sustainability

Assessing the sustainability of a company’s dividend payments involves examining its financial health, management practices, and market position.

Dividend Coverage Ratio

The dividend coverage ratio, calculated as earnings per share (EPS) divided by dividends per share (DPS), indicates whether a company’s earnings can comfortably cover its dividend payments.

  1. Example: A company with an EPS of $6 and a DPS of $2 has a coverage ratio of 3, suggesting that its earnings sufficiently cover the dividend.

Historical Dividend Stability

A company’s history of dividend payments and growth can provide insights into its commitment to returning value to shareholders and its ability to sustain dividends.

  1. Example: A company that has consistently increased its dividends for the past 20 years demonstrates reliability and a strong financial position.